Economy of Buffalo, New York facts for kids
The Buffalo area economy consists of a mix of industrial, light manufacturing, high technology and service-oriented private sector companies. Instead of relying on a single industry or sector for its economic future, the region has taken a diversified approach that has the potential to create opportunities for growth and expansion in the 21st century.
History
Buffalo and the surrounding area were long involved in railroad commerce, steel manufacture, automobile production, aircraft/aerospace design and production, Great Lakes shipping, and grain storage. Most of these industries have left the city through the years. Major steel production no longer exists in the area, although several smaller steel mills remain in operation. For example, Gibraltar Industries, a leading manufacturer, processor, and distributor of steel products for the building, industrial, and vehicular markets is headquartered in Buffalo. As of the 1950 United States Census, Buffalo was the 15th largest city in the country, the nation's largest inland port (twelfth overall), second biggest rail center, sixth largest steel producer, and eighth largest manufacturer.
Employment
Overall, employment in Buffalo has shifted as its population has declined and manufacturing has diminished. Buffalo's 2005 unemployment rate was 6.6%, contrasted with New York State's 5.0% rate. And from the fourth quarter of 2005 to the fourth quarter of 2006, Erie County had no net job growth, ranking it 271st among the 326 largest counties in the country. Yet the area has recently seen an upswing in job growth as unemployment has dropped to only 4.9% in July 2007 from 5.2% in 2006 and 6.6% in 2005. The area's manufacturing jobs have continued to show the largest losses in jobs with over 17,000 fewer than at the start of 2006. Yet other sectors of the economy have outdistanced manufacturing and are seeing large increases. Educational and health services added over 30,400 jobs in 2006 and over 20,500 jobs have been added in the professional and business (mostly finance) arena.
Life sciences
Buffalo has increasingly become a center for bioinformatics and human genome research, including work by researchers at the University at Buffalo and the Roswell Park Cancer Institute. This consortium is known as the Buffalo Niagara Medical Campus. It also includes: Buffalo Hearing & Speech Center, Buffalo Medical Group Foundation, Hauptman-Woodward Medical Research Institute, Kaleida Health, Olmsted Center for the Visually Impaired, Cleveland BioLabs and Upstate New York Transplant Services. The DNA samples used in The Human Genome Project were also collected from anonymous donors from Buffalo.
Entrepreneurial resources and life science business consultants accelerate the growth and development of emerging companies found within the Buffalo Niagara Medical Campus and Upstate New York Region. For example, Buffalo BioSciences is a technology commercialization partner to the New York State Center of Excellence in Bioinformatics & Life Sciences and contributed to the launch and early success of Empire Genomics –- a firm based on research conducted at Roswell Park Cancer Institute by Dr. Norma Nowak enabling the delivery of personalized medicine.
Other
Buffalo is home to Rich Products, one of the world's largest family-owned food manufacturers. Canadian brewer Labatt moved its US headquarters to Buffalo in May 2007. This is in large part due to Buffalo's location directly in the middle of the Northeastern Trade Corridor. The city is the heart of the Canadian-American corridor. Over 80% of all U.S.-Canada trade occurs via border crossings in the eastern United States and with five bridges to Canada, the Buffalo area is one of the key eastern border crossing locations. Cheese company Sorrento Lactalis is also based in Buffalo.
New Era Cap Company, the largest sports-licensed headwear company in the United States, is based in Buffalo. It opened new headquarters in 2007 in the former Federal Reserve Building in downtown Buffalo.
The windshield wiper maker Trico, founded in Buffalo by John R. Oishei, operated three major manufacturing facilities but has since closed all of them and moved operations to Mexico. In 1998, the company head office moved to Rochester Hills, Michigan. Trico's Plant No. 1 was placed on the National Register of Historic Places in 2001 and in 2014 was being re-developed by the State University of New York at Buffalo. The John R. Oishei Foundation is western New York's largest and the new Women's & Children's Hospital, scheduled to open in 2015, will be named the John R. Oishei Children's Hospital.
For many years, Buffalo was the nation's second largest rail center, after Chicago. Peaked traffic reached during World War II, but declined soon after the war. Through the 1960s and 1970s freight traffic via Buffalo declined, air travel and the New York State Thruway took railway passengers away as well. By 1980, the rail hub in the city was gone.
Del Monte Foods' Milk Bone dog biscuits are still manufactured in a small factory on the city's East Side.
Regionally based insurance companies also have maintained their headquarters in Buffalo, New York. There's Merchants Insurance Group and Lawley Insurance. Merchants Insurance Group is a property and casualty insurance company that provides commercial, personal property and casualty insurance throughout the Northeast and North Central United States. Lawley Insurance provides commercial insurance, employee benefits, risk management and personal insurance.
Delaware North Companies are headquartered in Buffalo.
Standard of living
The loss of traditional jobs in manufacturing, rapid suburbanization and high costs of labor have led to economic decline, making Buffalo one of the poorest among U.S. cities with populations of more than 250,000 people. An estimated 28.7–29.9% of Buffalo residents live below the poverty line, behind either only Detroit, or only Detroit and Cleveland. Buffalo's median household income of $27,850 is third-lowest among large cities, behind only Miami and Cleveland; however the median household income for the metropolitan area is $57,000.
This, in part, has led to the Buffalo-Niagara Falls metropolitan area having the most affordable housing market in the U.S. today. The quarterly NAHB/Wells Fargo Housing Opportunity Index (HOI) noted that nearly 90% of the new and existing homes sold in the metropolitan area during the second quarter were affordable to families making the area's median income of $57,000. The area median price of homes was $75,000.
Buffalo faces issues with vacant and abandoned houses, as the city ranks second to St. Louis on the list of American cities with the most vacant properties per capita. Since 2000, the city has torn down 2,000 vacant homes but as many as 10,000 still remain. Mayor Byron W. Brown recently unveiled a $100 million, five-year plan to demolish 5,000 more houses. The city's move away from heavy industry and toward a service and bioinformatics economy has brought improved air and water quality, which benefit not only residents and tourists but the bioregion as a whole. In July 2005, Reader's Digest ranked Buffalo as the third cleanest large city in the nation.
Buffalo's economy has begun to see significant improvements since the early 2010s. Money from state governor Andrew Cuomo, plans for different construction programs, and hundreds of new jobs have brought strong economic change to the area.
Images for kids
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Buffalo Savings Bank Building
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One M&T Plaza, the headquarters of M&T Bank.
